No Health Insurance Leaves Wife with Husband’s Medical Bills And In Need Of Help

Posted on November 5, 2009 by
Ilyce R. Glink

Q: My husband passed away and left me with huge medical bills because he did not have health insurance. We were married for 12 ½ years and lived together in his house. He was the sole owner of the property.

My attorney opened probate and asked the judge to appoint me as the personal representative. He advised me to sell the real estate to pay for the medical bills.

In the meantime, some of the creditors to the estate turned in my name to the collection agencies even though these are my husband’s debts.

There is a pending sale on the house. The tile company’s preliminary title report shows that my husband’s ex-wife will get half of the net proceeds based on the divorce decree (after the real estate commission is paid).

As heirs to the estate, the other half of the net will be split between me and my 30-year old stepson, if anything is left after the creditors who filed lien on the estate get paid.

Here’s my problem: according to the title company, only the creditors who filed liens will be paid. The creditors who did not file a lien will not be paid from the proceeds. The debt will become my responsibility instead of the estate’s.

It seems grossly unfair that the ex-wife and my stepson will get their share where I am left still with a huge debt. The sale of the estate puts me in a worse situation than before because the debt becomes my own responsibility.

What can I do to let the estate pay for the debt? Can I call the creditors and let them know they will not get paid if they don’t file their claims?

The closing of the sale will be next week barring my withdrawal from the sale. I need help urgently.

A: I’m so sorry for your loss. You need more help than I can give you. But here are some issues to talk over with a competent estate attorney.

First, it’s might be unfair that you would be responsible for your husband’s medical bills. But some of your creditors might argue that you benefited from his treatment and as his spouse you should be in debt as much as he was. It does seem unfair that others will benefit from the sale of the home and you should be in a worse position.

As the administrator of the estate, you likely have the responsibility of notifying creditors about your husband’s death. Your attorney can advise you on how you can meet this obligation, but typically you would contact all known creditors and then place an ad in the paper or online letting creditors know your husband has passed. They must file a claim with the estate in a short period of time.

Finally, if for some reason all of these medical bills become your responsibility, you should talk to a bankruptcy attorney about whether filing makes sense.

It’s unfortunate that you and your husband didn’t plan for this time, either by putting your name on the house or by purchasing life insurance that would have helped to pay off some of these bills. Now, you’re stuck facing this financial mess at a time when I’m sure you’re mourning the loss of your spouse and partner.

I urge you to get help immediately. Is the estate attorney you are working with helping you on these issues? Make sure you rely on people you can trust for good advice on these issues. It may be that the creditors with liens and other creditors even without liens might be able to get paid from the proceeds of the sale of the home, before family members get paid. But you will only be able to figure it out by speaking with an attorney familiar in this area of the law and getting his or her advice.

Definitioner

A Title Company is the corporation or company that insures the status of title on real estate (called title insurance) at a closing, and may handle other aspects of the real estate closing.

Title

Title refers to the ownership of a particular piece of property.

Real Estate

Real Estate is land and anything permanently attached to it, such as buildings and improvements.

Paper

Paper is slang usage that refers to the mortgage, trust deed, installment, and land contract.

Lien

A Lien is an encumbrance against the property, which may be voluntary or involuntary. There are many different kinds of liens, including a tax lien (for unpaid federal, state, or real estate taxes), a judgment lien (for monetary judgments by a court of law), a mortgage lien (when you take out a mortgage), and a mechanic's lien (for work done by a contractor on the property that has not been paid for). For a lien to be attached to the property's title, it must usually be filed or recorded with a local county government office.